In this digital era, technology has influenced almost all aspects of life, including taxation. One of the innovations that is being implemented in Indonesia is the new tax administration system: Core Tax. This system aims to improve tax administration efficiency, transparency, and accountability. However, what exactly is the Core Tax System, how does it work, and what are the benefits for Indonesia? This article will get you to know more about Core Tax.

What is the Core Tax System (CTS)?

Core Tax System (CTS) is an information technology system designed to support and manage tax administration processes in an integrated manner. This system includes various features that enable more efficient management of tax data, including taxpayer registration, tax calculation, receipt of payments, and tax reporting.

The system was officially launched on January 1st, 2025. This followed a pre-implementation phase that began in late 2024, allowing taxpayers to familiarize themselves with the new system.

CTS adopts the latest technology to digitize various aspects of tax administration, letting the government to better monitor, manage, and supervise tax activities. This effort is part of the effort to build a more modern and efficient tax system, which is in line with the tax reform program being carried out by the government.

Function of the Core Tax System in Indonesia

The Core Tax System has several main functions that are important in managing tax administration, both for taxpayers and for the government. Here are some of the main functions of CTS:

1. Taxpayer Registration and Management CTS simplifies the registration process for new taxpayers (WP), both individuals and business entities. Through this system, taxpayer data can be well integrated, making it easier for tax authorities to monitor and verify. A faster and more efficient registration process allows more taxpayers to be formally registered.
2. Tax Calculation and Assessment One of the main functions of the Core Tax System is to automate accurate tax calculations based on data entered by taxpayers. So that the risk of human error in calculating taxes can be minimized.
3. Tax Receipts and Payments CTS allows taxpayers to pay taxes online, making the payment process easier and faster. In addition, the government can easily monitor tax receipts in real-time, ensuring that taxes paid are recorded accurately.
4. Tax Report Through CTS, taxpayers can easily submit tax reports electronically. These reports can be directly processed and verified by the tax authorities, which reduces the risk of errors in tax reports and speeds up the audit process.
5. Tax Monitoring and Supervision With a digital system, tax authorities can monitor tax transactions and taxpayer compliance more effectively. This allows for early detection of potential tax evasion or fraud and makes it easier for tax law enforcement.
6. Tax Information Service CTS provides customer service facilities where Taxpayers can receive complete and easily accessible tax information services online.

Benefits of the Core Tax System in Indonesia

The development of CTS certainly has a positive impact in Indonesia, some of the benefits that can be received by Indonesian Taxpayers are a more efficient tax administration process, transparency, reducing time and costs for administration, and also more accurate tax information to be accessed through various channels.

Other than taxpayers, the existence of CTS also certainly improves the performance of the Government in the process of managing data that is more integrated and accurate and can reduce tax administration costs.

Conclusion

Core Tax, or the Core Tax System, is a significant step towards modernizing tax administration in Indonesia. By streamlining processes, improving compliance, and providing better services, Core Tax aims to create a more efficient and equitable tax system for both businesses and the government. While challenges may exist, the long-term benefits in terms of efficiency, compliance, and fairness make it a crucial initiative for the country’s economic development.